CJEU on VAT agricultural flat rate scheme

KEY POINTS

• The benefits of the agricultural flat rate scheme.
• Its use as an alternative to normal VAT registration.
• HMRC guidance placed a monetary limit on the benefit accruing from the scheme.
• The European VAT Directive does allow the exclusion from the scheme of some categories of farmers.
• The Court of Justice of the European Union confirmed the scheme can be used even if there is a substantial benefit.
• The validity of the scheme must be considered on a macroeconomic scale by reference to all flat rate farmers.

With the complexities of Brexit being considered in depth by the farming community it is ironic that in Shields & Sons Partnership v HMRC [2017] C262-16 the Court of Justice of the European Union (CJEU) confirmed the VAT position of...